GR 187942; (September, 2016) (Digest)
G.R. No. 187942 , September 07, 2016
THE ROMAN CATHOLIC BISHOP OF TUGUEGARAO, PETITIONER, VS. FLORENTINA PRUDENCIO, NOW DECEASED, SUBSTITUTED BY HER HEIRS, ET AL., RESPONDENTS.
FACTS
Felipe Prudencio acquired a 13.0476-hectare parcel of land during his first marriage to Elena Antonio. Upon Elena’s death, Felipe and their five children became co-owners of the property. Felipe later married Teodora Abad, with whom he had two children. Upon Felipe’s death, Teodora and her children executed an Extra-Judicial Partition, fraudulently representing that Felipe and Elena had no children, thereby adjudicating the entire property to Teodora. Title was transferred to her name. Teodora subsequently sold the land to Spouses Isidro Cepeda and Salvacion Divini, who then sold it to the Roman Catholic Bishop of Tuguegarao (petitioner).
The children from the first marriage, respondents herein, filed a Complaint for Partition with Reconveyance. They asserted that the Extra-Judicial Partition was void for excluding them as compulsory heirs. They claimed ownership over 10.2512 hectares, representing their shares from both their mother’s estate and their father’s estate. The Regional Trial Court declared the Extra-Judicial Partition and the subsequent sales covering the respondents’ shares null and void, ordering the petitioner to reconvey the 96,926 square-meter portion. The Court of Appeals affirmed this ruling.
ISSUE
Whether the petitioner is an innocent purchaser for value, thereby protecting its title from the respondents’ claim for reconveyance.
RULING
No. The Supreme Court affirmed the lower courts’ rulings, denying the petitioner the status of an innocent purchaser for value. The legal logic hinges on the principle that a void contract, such as the fraudulent Extra-Judicial Partition, produces no legal effect. Since Teodora acquired no valid title from that partition, she could not transmit any valid ownership to the Spouses Cepeda, and consequently, none to the petitioner. The chain of title was broken at its source.
The Court emphasized that the defense of being a purchaser in good faith and for value requires not only payment of a fair price but also a showing that the buyer exercised the diligence of a prudent person in verifying the vendor’s title. Here, the petitioner’s lawyer conducted a verification but failed to discover the fraud, which was ascertainable from the face of the Extra-Judicial Partition itself. The document’s false declaration that the first marriage produced no children was a red flag that should have prompted further inquiry. This failure negates the claim of good faith. Consequently, the subsequent sales concerning the respondents’ shares are void. The petitioner, not being a protected innocent purchaser, is ordered to reconvey the specific 96,926-square-meter portion to the respondents, who are the true owners by virtue of intestate succession.